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Organizational Data 135

chains. Viewed from a different perspective, distribution chains 1 and 3 use two
plants to deliver materials to their customers, whereas distribution chain 2 uses
only one plant.
Recall from Chapter 2 that GBI has three plants in the United States and
two in Germany. In the United States, the Dallas plant is the sole manufacturing

Figure 5-7: Plants

site, while the plants in San Diego and Miami serve as distribution centers.
Finished goods are shipped from the Dallas facility to the other two facilities as
needed. In contrast, trading goods are shipped directly to the two regional dis-
tribution centers by the vendors. The Dallas plant does not hold an inventory
of trading goods. Normally, the Miami plant delivers products to customers in
the Eastern United States and the San Diego to the Western United States.
However, the Dallas plant serves as an overfl ow facility to the two other plants
and can ship fi nished goods anywhere in the country, as needed. In Germany,
the Heidelberg plant ships to locations in the South and the Hamburg plant to
locations in the North.

SHIPPING POINT

A shipping point is a location in a plant from which outbound deliveries are
shipped. It can be a physical location, such as a loading dock, a rail depot, or a
mail room. It can also be a designated group of employees who, for example,
handle express or special deliveries. A shipping point is associated with one or
more plants, and a plant can have more than one shipping point. A plant must
have at least one shipping point from which to process deliveries, although the
shipping point does not have to be physically located within the plant.
Figure 5-8 diagrams a scenario in which multiple plants access one ship-
ping point. The fi gure represents a campus for a company that includes a
factory and two storage facilities, all of which are plants. Note that the only
plant that has a shipping point is the storage facility located by the front offi ce.
Therefore, all materials from the factory and the main storage facility must
fi rst be moved to this facility and then shipped to their destinations.
In contrast, Figure 5-9 illustrates a scenario in which several plants share
three shipping points. Storage facility #1 has one shipping point, and facility #3
has two. Storage facility #2 has none, so it uses the shipping points located in the

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